E.ON to set up new independent energy trading business

German utility E.ON expects to trade independently from spin-off Uniper on its core energy markets by the end of the year, its spokesman has told ICIS.

E.ON last year spun off its conventional power generation and global energy trading business to Uniper so it could focus on renewables, energy networks and customer solutions ( see EDEM 8 June 2016 ).

Uniper has been responsible for conventional generation and trading services since this move.

E.ON expects its new independent trading arm to trade mainly to supply energy to its customers and to sell renewables on the wholesale market on behalf of itself and other companies.

“It’s thus not a classic trading floor where earnings before interest and taxes are produced with the trading itself,” the spokesman said.

The establishment of the procurement and marketing functions in E.ON’s core markets – Germany, Sweden and the UK – is due to be completed by the end of the year.

The company will start trading on respective energy exchanges in the third quarter. In Germany, it will initially be represented at the EPEX SPOT power exchange and PEGAS gas trading platform, with 1 July set as the market go-live date.

E.ON is already an EPEX SPOT member for German and Austrian day-ahead and intra-day power trading, the exchange’s website showed. Uniper is listed for all EPEX SPOT markets.

E.ON had listed a number of risks to its Uniper spin-off at the time, including changes in counterparty requirements on the basis of Uniper’s assigned credit rating. This meant that new agreements had to be thrashed out before Uniper’s trading arm could enter into large transactions. laura.raus@icis.com